Asbestos attorneys settle racketeering case against them for $7.3M

JACKSONVILLE, Fla. (Legal Newsline) – CSX Transportation on Thursday said its racketeering and fraud lawsuit against two Pittsburgh asbestos attorneys and a now deceased West Virginia radiologist has been concluded.

The railroad company said a settlement has been signed in its case against attorneys Robert N. Peirce Jr. and Louis A. Raimond and radiologist Ray Harron.

As part of the settlement, a previous verdict will stand, and CSX will be paid $7.3 million to satisfy the trial court judgment entered against the lawyers and doctor on Sept. 25, 2013, and in resolution of disputed motions for attorney fees and costs.

CSX brought the claims against the defendants on July 5, 2007, alleging they conspired to manufacture and litigate fraudulent asbestos claims against the company. In December 2012, a jury agreed and awarded CSX $429,000 in damages – an amount later tripled to $1.3 million by the Federal Judge Frederick Stamp as required by the federal racketeering statute. Those damages and legal fees totaled $7.3 million.

Prior to this settlement, the judgment had been on appeal to the Fourth Circuit Court of Appeals in Richmond, Va. In a press release, CSX said that appeal will be dismissed, leaving the jury’s findings and resulting judgment undisturbed.

“We sincerely thank the jury and the judges,” said Ellen M. Fitzsimmons, CSX’s executive vice president, law and public affairs. “They acknowledged that fraud in injury claims degrades the U.S. system and makes it harder for truly injured persons to be treated fairly.”

Attorneys Marc Williams and Robert Massie from Nelson Mullins in Huntington as well as Sam Tarry and Mitchell Morris with McGuire Woods in Richmond, Va., handled the case for CSX.

Peirce and Raimond — formerly of the Pittsburgh firm Peirce, Raimond & Coulter — as well as Harron were found to have conspired to fabricate asbestos claims against CSX.

CSX’s original complaint, filed in 2005, said Peirce’s firm hid nine fraudulent claims among other lawsuits filed by the law firm in West Virginia. The nine suits were filed and settled from 2000 to 2006. Stamp granted summary judgment to the Peirce firm in 2009, ruling a four-year statute of limitations began when the Peirce firm began targeting CSX.

However, the Fourth Circuit overturned that decision and gave new life to the lawsuit. The U.S. Supreme Court declined to hear the defendants’ appeal of the decision. CSX amended its complaint to include two additional claims it said were fraudulent. The Peirce firm filed counterclaims against the company that said it was engaging in fraud by bringing and conducting the lawsuit, though the jury ruled for CSX on them.

In 2005, federal court judge Janis Graham Jack made national headlines when she uncovered duplicate and fraudulent silica diagnoses in her Texas courtroom. Many of those diagnoses were made by Harron and were made on plaintiffs who had already brought asbestos claims.

In Jack’s opinion dismissing the claims, she said “These diagnoses were driven by neither health nor justice – they were manufactured for money.”

Following Harron’s admission that he did not even make the diagnoses of the patients whose X-rays he read, Jack noted that most of “these diagnoses are more the creation of lawyers than doctors.”

Harron died in July.

The CSX Foundation supports Beyond our Rails (beyondourrails.org), a shared effort between CSX and its employees to advance safety, wellness, environmental and community-based initiatives that seek to improve the well-being of the people and places CSX serves.

“These funds will be donated to the CSX Foundation, where they will be dedicated to philanthropic efforts serving CSX’s communities,” Fitzsimmons said.